What To Include In A Short Sale Package
Here's a quick checklist from our software of the items you should provide when submitting a short sale to the lender.
All posts by Duncan Wierman
Do I Need A Real Estate Agent
A real estate agent is NOT needed for a short sale. The sad truth is most real estate agents will unknowingly hurt you in a short sale because they do not know or understand the short sale process. Just by reading the information at this website your knowledge is superior. Unless a Realtor is already involved in the transaction you’re better off without one.
Instruction Letter To Seller
The following letter can be used when working with sellers as a way to get all of the information needed to start the short sale without having to actually meet the seller in person. My personal choice is to have a phone conversation with the seller then let them know I will send over all the paperwork by email or fax. This is the most efficient way to do short sales.
Read the letter at least three times word for word then continue at the bottom of the page. Continue reading Instruction Letter To Seller
What is a Borrowers Financial Statement?
Lenders require a Financial Statement be submitted with short sale packages to show the borrower is financially unable to pay on the loan. Always ask the seller to complete the financial statement to the best of their ability. Continue reading What is a Borrowers Financial Statement?
What is a Short Sale Hardship Letter?
The sadder the hardship letter, the better. The goal of the letter is to bring tears of sadness to the readers eyes with a statement of facts written by the owner describing how they got into the financial bind. The owner should make a plea to the lender to accept less than full payment and to work with you (your name) on the short sale.
Loss mitigators are not inhumane and can understand if you lost your job, were hospitalized or a truck ran over your entire family. Lenders are not empathetic to situations involving dishonesty or criminal behavior.
Authorization To Release Information (ATRI) Form
Lenders will request a signed Authorization Form from the seller before communicating with you. You are much better off using a Limited Power Of Attorney(POA) instead!
With a Power Of Attorney the lender must negotiate with you in good faith for a workout or mortgage modification. With an ATRI the lender only has to release information.
Continue reading Authorization To Release Information (ATRI) Form
What The Lender Wants On A Short Sale
When considering a short sale lenders will request that you complete their specific short sale package. The reason for completing their short sale packet is to provide them with the “necessary” information so they can make a determination to accept or reject the short sale.
Necessary Short Sale Items From The Seller
When I first started doing short sales years ago I would meet with sellers to go over all of the details and gather all the information I needed. It literally took me hours to travel to the property and meet with the sellers. This is a valid approach and I encourage you to do the same, at least a few times.
Short Sale Basics For Working With The Seller
The relationship you establish with the seller in the beginning is critical to your success in the short sale world. The seller is in a difficult position and you may be their last hope to stop a foreclosure and help them move forward with their life. They have entrusted you to take care of them. If you succeed you are their best friend and savior. If you fail they may blame you for ruining their life… unless you take control from the beginning.
Continue reading Short Sale Basics For Working With The Seller
What Can The Investor Legally Pay A Seller When Doing A Short Sale?
Nothing. If the seller is compensated in any way for doing a short sale you risk a felony conviction for mortgage fraud.
Mortgage fraud is a term used to describe a broad variety of actions where the intent is to materially misrepresent information on a mortgage loan application, in order to obtain a loan or when one or more individuals defraud a financial institution. A mortgage fraud conviction is a felony. Continue reading What Can The Investor Legally Pay A Seller When Doing A Short Sale?
What Can An Investor Guarantee?
What Can An Investor Guarantee A Homeowner Facing Foreclosure That Wants To Do A Short Sale?
Answer: Absolutely nothing! Continue reading What Can An Investor Guarantee?
Foreclosure vs. Bankruptcy
Which is worse: foreclosure or bankruptcy?
Bankruptcy and foreclosure are both derogatory legal actions in the public record portion of a consumer’s credit report. As such, they will each have a significant impact on any person’s credit standing. How much either would impact your credit would depend on ALL the factors showing in your credit. You should consult with a knowledgeable attorney to discuss the implications prior to proceeding with either action.